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Commentary: The Microsoft Trial: Justice Is Swift But Tech Is Swifter

October 03, 1999

News: Analysis & Commentary

Commentary: The Microsoft Trial: Justice Is Swift--but Tech Is Swifter

When I entered U.S. District Judge Thomas Penfield Jackson's courtroom last Oct. 19, I was eager to see the first antitrust trial run on Internet time. Justice Dept. officials crowed that it could bring a quick-hit case against Microsoft Corp. and prove that the creaky 1890 Sherman Act could zap predators in high-tech industries. By the New Year, I figured, those hard benches would be a distant memory.

But the months slogged on, and the only thing that seemed to move on Internet time was the industry itself. The extent of change in the tech world became clear on Sept. 21, when the now celebrity lawyers for both sides strode through the phalanx of press outside the rain-swept courthouse to present final arguments. As government prosecutor David Boies made his case that Microsoft had engaged in illegal anticompetitive behavior, I couldn't help feeling the litany of abuses had lost much of its relevance.E-VOLUTION. That's not to say Microsoft attorney John Warden could explain away the charges. And for all the changes in the industry, his argument that the company does not have monopoly power in PC operating systems is no more persuasive now than it was 11 months ago. Warden was effective, however, when he laid out just how the Net and computer markets are morphing. The implication: While Justice may win on details, Microsoft can make the case that it's too late for judicial interference to do better than the markets are doing at correcting any problems.

The finale was a bit of a letdown in terms of theatrics. Boies' performance lacked the "gotcha!" moments that marked his cross-examination of Microsoft witnesses. The power of his final argument rested on the cumulative effect of the numerous company e-mails that he said proved Microsoft "coerced, induced, forced many people in the industry to do its will."

In summing up, Boies wove a compelling story from his documents that began with Microsoft's fears of upstart Netscape Communications Corp. seizing the Net lead. He then used other documents to show Microsoft set out to use its Windows monopoly to kill off Netscape's browser. He argued that the "it's a changing world" argument "can't mitigate what Microsoft has done over the past several years." That may, in the end, convince Jackson to rule that Microsoft did violate antitrust laws--an outcome that some company insiders concede is likely.

Microsoft's hopes rest on Warden's ability to convince Jackson there's little he can do now that won't hurt more than it helps. Warden had his own documents, including those describing the three-way deal among AOL, Netscape, and Sun Microsystems. The papers showed, he argued, that this "large industrial alliance" planned "a coordinated attack on Microsoft" by creating an AOL-based system that would bypass Windows. As part of its plan, AOL estimated that Netscape browser use would more than double between 1997 and 2002, hardly evidence that Microsoft was harming the market, Warden noted.

What also may help Microsoft avoid heavy penalties is the limited scope of the charges. Despite widespread fear in the industry that Microsoft would wield its Windows clout in all sorts of markets, as it allegedly did in browsers, Justice did not introduce evidence about those markets. Its case was about browsers. Although the government is mulling mandatory licensing of Windows or even a breakup, Microsoft could persuasively argue that a case about only one product doesn't merit such measures.

So the trial on Internet time is over--sort of. Perhaps by Thanksgiving, Jackson will hand down his decision. But that's not really the end. Given the all-but-inevitable high court review of the decision, I'm planning my "Good-bye Microsoft Trial" blast now--for New Year's Eve, 2002.By Susan B. Garland